LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
200 W. Washington St., Suite 301
Indianapolis, IN 46204
(317) 233-0696
iga.in.gov
FISCAL IMPACT STATEMENT
LS 6840 NOTE PREPARED: Dec 29, 2023
BILL NUMBER: HB 1275 BILL AMENDED:
SUBJECT: Uninsured Motorist Coverage for Contract Carriers.
FIRST AUTHOR: Rep. Gore BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
XDEDICATED
FEDERAL
Summary of Legislation: This bill requires uninsured and underinsured motorist coverage of at least
$1,000,000 per passenger for a contract carrier that transports employees in the course of the employee's
employment. The bill also requires a rail carrier that contracts with a contract carrier for the transportation
of employees of the rail carrier to verify that the contract carrier has the minimum uninsured and
underinsured motorist coverage.
Effective Date: July 1, 2024.
Explanation of State Expenditures:
Explanation of State Revenues: Summary: To the extent contract carriers do not currently carry insurance
coverage required in the bill, insurance policies sold in the state could be impacted. Any increase in insurance
coverage in the state could increase revenue to the General Fund from either adjusted gross income (AGI)
tax or insurance premium tax collections, however any increase in revenue is expected to be minor.
Additionally, to the extent either (1) a contract carrier is found to not have proper insurance in place or (2)
a rail carrier fails to verify a contract carrier has proper insurance in place, the bill could increase Class C
infraction convictions in the state, which would increase revenue to the General Fund. Any increase in
General Fund revenue from Class C infraction convictions is expected to be minimal.
Additional Information: Domestic insurers have the option to pay taxes on insurance premiums written in
the state or to pay the AGI tax. Foreign insurers are required to pay taxes on premiums written in the state,
and some foreign insurers are assessed additional retaliatory taxes. In these cases, the minimum tax rate
HB 1275 1 would be 1.3% of written premiums. Revenue received from the AGI and insurance premium tax is deposited
in the General Fund.
To the extent individuals obtain these policies from foreign insurers, the General Fund could receive
additional revenue from taxes paid on insurance premiums. If these policies are obtained from domestic
insurers, the General Fund could receive additional revenue from the AGI tax. In both of these cases, any
increase in General Fund revenue is indeterminable, but expected to be minor.
For FY 2023, the insurance premium tax generated approximately $261.8 M in revenue.
Penalty Provision: The maximum judgment for a Class C infraction is $500, which would be deposited in
the state General Fund. The total court fee revenue per case would range between $85.50 and $103. The
amount of court fees deposited will vary depending on whether the case is filed in a court of record or a
municipal court. The following linked document describes the fees and distribution of the revenue: Court
fees imposed in criminal, juvenile, and civil violation cases.
Explanation of Local Expenditures:
Explanation of Local Revenues: Penalty Provision: If additional court actions occur and a judgement is
entered, more revenue will be collected by certain local units. If the case is filed in a court of record, the
county will receive $33.90 and qualifying municipalities will receive a share of $2.10. If the case is filed in
a municipal court, the county receives $20, and the municipality will receive $33.50. The following linked
document describes the fees and distribution of the revenue: Court fees imposed in criminal, juvenile, and
civil violation cases.
State Agencies Affected:
Local Agencies Affected: Trial courts, local law enforcement agencies.
Information Sources: Indiana Supreme Court, Indiana Trial Court Fee Manual
Fiscal Analyst: Bill Brumbach, 317-232-9559.
HB 1275 2